Limits of power

Can the CRTC order a carrier to build broadband facilities where no service exists?

How much power does Canada’s telecom regulator actually wield if it decides to add broadband to the list of basic services?

This is turning into an important question as the Commission approaches the end of the 3 week-long oral phase of its “Review of basic telecommunications services.”

Late Monday afternoon, I replied to a stream on Twitter that was discussing how the CRTC could order phone companies to dig into their profits to fund universal broadband. I commented that the CRTC can create incentives for people to build facilities, but it lacked the power to order a company to build where it didn’t want to:

It appears that the CRTC also wants to clarify the extent of its powers. In a letter to parties in the proceeding, the Commission asks for “views, along with supporting rationale, on the Commission’s legal authority as it relates to certain aspects of retail broadband Internet access services”, including:

1. its jurisdiction to mandate the provision of broadband Internet access service in areas where such speeds are not available, in areas where facilities exist but can’t deliver such speeds as well as areas where new facilities would have to be built;
2. the CRTC’s ability to use the “unjust discrimination or undue disadvantage” provisions of the Telecom Act where a carrier provides services to some people in its operating territory but not to everyone; and,
3. the CRTC’s authority to set a price ceiling on entry-level broadband services.

The CRTC did not ask for comment on the question of upon which carriers an obligation to build may fall. Would it be the so-called incumbent phone company? In Canada, cable companies were first to offer broadband. In some areas, it is a local wireless internet service provider who is the “incumbent” broadband service provider, some of which received government funding to establish service. So, where is the definition of a carrier’s operating territory and upon which carrier or carriers would the CRTC impose an obligation to build?

Comments are due to be submitted to the CRTC May 5.

Ultimately, the Court will decide if the government has the power to order a company to build facilities where it doesn’t want to.

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[Update: April 26, 2:00 pm]
In 2010, the issue of Commission powers was raised and 2 legal opinions were filed. Bell filed an Opinion authored by Michael Ryan of Arnold & Porter; PIAC filed an Opinion authored by Barbara A. Cherry, J.D., Ph.D.

The documents have been uploaded to Scribd, from their original sources: the Ryan Memorandum was Appendix 3 of Bell’s 26 April 2010 evidence [2.5MB zip]; the Cherry Memorandum was filed as part of a PIAC interrogatory response PIAC(TELUS)20May10-3 [140 KB zip].

Thanks to a neighbour for pointing to the earlier process

[Update: April 26, 2:30 pm]
Another Opinion prepared by Tamir Israel and oline Twiss was filed by CIPPIC in its August 30 (2010) evidence [275KB zip]